CHAPTER 5

LABOR RELATIONS

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 CONTENTS
5.1. Building Positive Employee Relations
5.1.1. What is Employee Relations
5.1.2. Employee Relations Programs for Building and Maintain Positive
Employee Relations
5.1.3. The Ethnical Organization
5.2. Labor Relations and Collective Bargaining
5.2.1. The Collective Bargaining Programs
5.2.2. Dealing with Disputes and Grievances
5.3. Safety, Healthy and Risk Management
5.1. Building Positive Employee Relations

LEARNING OBJECTIVES
• Define employee relations.
• Discuss at least four methods for managing
employee relations.
• Explain what is meant by ethical behavior.
• Explain what is meant by fair disciplinary practices.
• Answer the question, “How do companies become
‘Best Companies to Work For’?”
 5.1.1. What is Employee
Relations

employee relations
The activity that involves establishing and maintaining the positive employee–employer
relationships that contribute to satisfactory productivity, motivation, morale, and
discipline, and to maintaining a positive, productive, and cohesive work environment.
Employers can do many things to build positive employee relations:
- providing good training, fair appraisals, and competitive pay and benefits
- employee fair treatment programs, improving employee relations through improved
communications, developing employee recognition/relations programs, and having fair
and predictable disciplinary procedures
 5.1.2. Employee Relations
Programs

Ensuring Fair Treatment

Unfair treatment reduces morale, poisons trust, and negatively impacts employee
relations and performance.
Employees of abusive supervisors are more likely to quit, and to report lower job and
life satisfaction and higher stress
 At work, fair treatment reflects concrete actions such as “employees are treated
with respect,” and “employees are treated fairly”
5.1.2. Employee Relations
Programs
 5.1.2. Employee Relations
Programs

Bullying and Victimization

Bullying and victimization— singling out someone to harass and mistreat—is a serious problem. The U.S.
government (www.stopbullying.gov) says most would agree that bullying involves three things:
● Imbalance of power. People who bully use their power to control or harm, and the people being
bullied may have a hard time defending themselves.
● Intent to cause harm. Actions done by accident are not bullying; the person bullying has a goal to
cause harm.
● Repetition. Incidents of bullying happen to the same person over and over by the same person or
group, and that bullying can take many forms, such as:
- Verbal: name-calling, teasing
- Social: spreading rumors, leaving people out on purpose, breaking up friendships
- Physical: hitting, punching, shoving
- Cyberbullying: using the Internet, mobile phones, or other digital technologies to harm others
 5.1.2. Employee Relations
Programs

Improving Employee Relations Through Communications Programs

Aim to bolster their employee relations efforts, on the reasonable assumption that
employees feel better about their employers when they’re “kept in the loop.”
 Two-way communication also helps management know what’s bothering
employees
- hosting employee focus groups,
- making available ombudsman and suggestion boxes,
- and implementing telephone, messaging, and Web-based hotlines
 5.1.2. Employee Relations
Programs

Improving Employee Relations Through Communications Programs organizational climate

Aim to bolster their employee relations efforts, on the reasonable The perceptions a company’s
assumption that employees feel better about their employers when employees share about the firm’s
they’re “kept in the loop.” psychological environment, for
instance,
 Two-way communication also helps management know what’s in terms of things like concern for
bothering employees employees’ well-being,
- hosting employee focus groups, supervisory behavior, flexibility,
- making available ombudsman and suggestion boxes, appreciation,
ethics, empowerment, political
- and implementing telephone, messaging, and Web-based hotlines
behaviors, and rewards.
 5.1.2. Employee Relations
Programs

Develop Employee Recognition/Relations Programs

Opportunities for two-way communications like these improve employee relations, but there are
other employee relations programs, particularly formal company-wide programs such as employee-
of-the-month awards.
Use Employee Involvement Programs
Employee relations also tend to improve when employees become involved with the
company in positive ways, and so employee involvement is another useful employee
relations strategy.
Employers encourage employee involvement in various ways.
- Some organize focus groups. A focus group is a small sample of employees who are presented
with a specific question or issue and who interactively express their opinions and attitudes on that
issue with the group’s assigned facilitator.
 5.1.3. The Ethnical Organization

why include ethics in a human resource management book?

Ethics are “the principles of conduct governing an individual or a group”—the
principles people use to decide what their conduct should be.52 Of course, not all
conduct involves ethics
Three reasons:
• First, ethics is not theoretical. Instead, it greases the wheels that make businesses
work. Managers who promise raises but don’t deliver, salespeople who say “The
order’s coming” when it’s not, production managers who take kickbacks from
suppliers— they all corrode the trust that day-to-day business transactions depend
on.
• Second, it is hard to even imagine an unethical company with good employee
relations.
• Third, ethical dilemmas are part of human resource management.
 5.1.3. The Ethnical Organization

Why include ethics in a human resource management book?

Ethics are “the principles of conduct governing an individual or a group”—the
principles people use to decide what their conduct should be.52 Of course, not all
conduct involves ethics
Three reasons:
• First, ethics is not theoretical. Instead, it greases the wheels that make businesses
work. Managers who promise raises but don’t deliver, salespeople who say “The
order’s coming” when it’s not, production managers who take kickbacks from
suppliers— they all corrode the trust that day-to-day business transactions depend
on.
• Second, it is hard to even imagine an unethical company with good employee
relations.
• Third, ethical dilemmas are part of human resource management.
 5.1.3. The Ethnical Organization

What Shapes Ethical Behavior at Work?

Why do people do bad things? It’s complicated. However, one review of over 30 years
of ethics research concluded that three factors combine to determine the ethical
choices we make.
The authors titled their paper “Bad Apples, Bad Cases, and Bad Barrels.” This title
highlighted their conclusion that when
• “Bad apples” (people who are inclined to make unethical choices), must deal with
• “Bad cases” (ethical situations that are ripe for unethical choices), while working in
• “Bad barrels” (company environments that foster or condone unethical choices), …
then people tend to act unethically.
 5.1.3. The Ethnical Organization

How Managers Can Create More Ethical Environments

Reduce Job-Related Pressures
If people did unethical things at work solely for personal gain or because they were “bad
people,” it perhaps would be understandable (though inexcusable). The scary thing is
that it’s often not personal interests but the pressures of the job.
As one former executive said at his trial, “I took these actions, knowing they were
wrong, in a misguided attempt to preserve the company to allow it to withstand what I
believed were temporary financial difficulties.”
 5.2. Labor Relations and Collective
Bargaining

LEARNING OBJECTIVES
• Give a brief history of the American labor movement.
• Discuss the main features of at least three major pieces of labor legislation.
• Present examples of what to expect during the union drive and election.
• Illustrate with examples bargaining that is not in good faith.
• Develop a grievance procedure.
• Describe a strategy for cooperative labor relations.
 5.2.2. The Collective Bargaining
Programs

What Is Collective Bargaining?

When and if the union becomes your employees’ representative, a day is set for
management and labor to meet and negotiate a labor agreement. This agreement
will contain specific provisions covering wages, hours, and working conditions.
Collective bargaining
The process through which representatives of management and the union meet to
negotiate a labor agreement.
 5.2.2. The Collective Bargaining
Programs

What Is Good Faith?

Good faith bargaining is the cornerstone of effective labor–management relations.
It means that both parties communicate and negotiate, match proposals with
counterproposals, and make a reasonable effort to arrive at an agreement.
It does not mean that one party compels another to agree. Nor does it require that
either party make any specific concessions (although some may be necessary).
 5.2.2. The Collective Bargaining
Programs

The Negotiating Team

Both union and management send negotiating teams to the bargaining table, and
both go into the bargaining sessions having “done their homework.”
Costing the Contract
Collective bargaining experts emphasize the need to cost the union’s demands
carefully.
 5.2.1. The Collective Bargaining
Programs

Bargaining Items
Labor law sets out categories of specific items that are subject to bargaining: These
are mandatory, voluntary, and illegal items.
Voluntary (or permissible) bargaining items
Items in collective bargaining over which bargaining is neither illegal nor mandatory—
neither party can be compelled against its wishes to negotiate over those items.
illegal bargaining items
Items in collective bargaining that are forbidden by law; for example, a clause agreeing to
hire “union members exclusively” would be illegal in a right-to-work state.
mandatory bargaining items
Items in collective bargaining that a party must bargain over if they are introduced by the
other party—for example, pay.
 5.2.1. The Collective Bargaining
Programs

Building Negotiating Skills

• Hammering out a satisfactory labor agreement requires negotiating skills.
• Experienced negotiators use leverage, desire, time, competition, information,
credibility, and judgment to improve their bargaining positions.
• Things you can leverage include necessity, desire, competition, and time.
 5.2.1. The Collective Bargaining
Programs

Bargaining Hints
Expert Reed Richardson has the following advice for bargainers: 11. Learn to control your emotions and use them
1. Be sure to set clear objectives for every bargaining item, and as a tool.
be sure you understand 12. As you make each bargaining move, be sure
the reason for each. you know its relationship to all other moves.
2. Do not hurry. 13. Measure each move against your objectives.
3. When in doubt, caucus with your associates. 14. Remember that collective bargaining is a
4. Be well prepared with firm data supporting your position. compromise process. There is no such thing as
5. Strive to keep some flexibility in your position. having all the pie.
6. Don’t concern yourself just with what the other party says 15. Try to understand the people and their
and does; find out why. personalities.
7. Respect the importance of face saving for the other party. 16. Remember that excessive bargainer
8. Be alert to the real intentions of the other party—not only for transparency and openness can backfire.
goals, but also for priorities.
9. Be a good listener.
10. Build a reputation for being fair but firm.
 5.2.2. Dealing with Disputes and
Grievances

The grievance process is the process or steps that the employer and union agreed
to follow to ascertain whether some action violated the collective bargaining
agreement.
• It is the vehicle for administering the contract day to day.
• However, this usually involves interpretation only, not negotiating new terms
or altering existing ones.
• The aim is to clarify what those contract points really mean, in the context of
addressing grievances regarding things like time off, disciplinary action, and
pay.
 5.2.2. Dealing with Disputes and
Grievances

Sources of Grievances
• In practice, it is probably easier to list those items that don’t precipitate
grievances than the ones that do.
• Employees may use just about anything involving wages, hours, or conditions
of employment as the basis of a grievance.
• Discipline cases and seniority problems including promotions, transfers, and
layoffs would top this list.
• Others would include grievances growing out of job evaluations and work
assignments, overtime, vacations, incentive plans, and holidays.
 5.2.2. Dealing with Disputes and
Grievances

The Grievance Procedure

• Most collective bargaining contracts contain a grievance procedure.
• It lists the steps in the procedure, time limits associated with each step, and
specific rules such as “all charges of contract violation must be reduced to
writing.” Nonunionized employers need such procedures, too.
• Grievance procedures differ from firm to firm. Some contain simple, two-step
procedures.